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Former Pakistani foreign minister Khawaja Asif will be allowed to contest the July 25 general election after the Supreme Court on Friday overturned his disqualification from politics, in a boost to the ruling Pakistan Muslim League-Nawaz (PML-N) party.

Mr Asif, a staunch ally of disqualified prime minister and PML-N founder Nawaz Sharif, was removed from parliament by a lower court in April as he was deemed not "honest" under a constitutional provision also used to oust Mr Sharif.

Mr Asif was disqualified for not declaring his employment and a source income from a UAE company, but the top court overturned the earlier ruling, which carried a lifetime ban from politics.

"God has granted mercy on a sinner like me, there is no count of God’s blessings. I am thankful to the judiciary," Khawaja Asif tweeted shortly after the verdict was announced.

Munir Malik, a senior member of Mr Asif's counsel, told the English-language Dawn newspaper that his client could contest the upcoming election after the ruling.

Mr Asif, one of Pakistan's most prominent politicians, is part of Mr Sharif's inner circle and one of the most senior figures in the ruling party.

He earlier headed the defence and power ministries and was foreign minister until the court disqualified him.

The Supreme Court's decision will have come as a surprise to many PML-N figures who have criticised the judiciary for bringing about a slew of cases against party officials and allege bias from judges.

The judiciary and in particular the chief justice, Saqib Nisar, who has embraced an activist role in politics and the running of government, deny favouring any party.

The Supreme Court's decision came as a former chief justice was sworn in as caretaker prime minister for an interim period of two months, hours after Pakistan's president dissolved the powerful lower house of parliament.

Nasir ul Mulk, who has a reputation as a defender of democratic institutions, will run the government pending results of July 25 elections.

President Mamnoon Hussain administered the oath of office at a ceremony attended by the political and military leadership.

Incumbent prime minister Shahid Khaqan Abbasi resigned at midnight on Thursday, ending a brief but turbulent tenure since July 2017 when he replaced Mr Sharif. It was only the third time in Pakistan's history that the National Assembly finished its five-year term.

Both the PML-N and the opposition had agreed on Mr Mulk, who served as Pakistan's chief justice from 2014 to 2015, as interim premier. Pakistan's constitution mandates new elections to be held within 60 days.

Mr Mulk's main job will be to supervise the July elections. On Sunday, candidates will begin submitting their nominations for the National Assembly and provincial assemblies. They have until June 6 to register.